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How the Danish jobs market hold despite a weak economy – How do day do it?

Wednesday, 14 September 2011
Danish labour market model has survived the crisis. Danish economy is going through a long period of weak growth. But unemployment is relatively low and remains around four percent.

The crisis hit Denmark, like Sweden, was its GDP falling like nothing by about five percent in 2009. But then, the Danish economy has not really recovered since then. The recovery is weak and production levels are still lower than three or four years ago.

The weak domestic market is an obstacle to the Danish revival back to the old days. Danish households have held back consumption, since many have seen the values of their homes fallen to an all time low. The bursting housing bubble has a depressing effect, of a kind that has not been so far been seen in Sweden.

Exports are running the Danish economy. But the structure of the Danish economy, with its many small and medium enterprises is different from the Swedish. In Sweden, the strongest industrial sector in manufacturing, while trade and services prevail in the neighbouring country - Denmark.

The Labour markets are also different. Danish model - known as "flexicurity" - means that employment protection is much weaker than in the Swedish model, but it is usually easier for those unemployed to find new jobs, Compared to Sweden, while more of vocational training, including apprenticeships are available.

This social model seems to have worked nicely even in times of crisis. Employment has indeed fallen and unemployment has risen slightly. But few other countries in Europe can now show off the unemployment figures around four percent - in Sweden, unemployment is are almost twice as high.

Denmark's economic outlook for the next few years is quite subdued. But assuming a strong position, with higher consumption standards than in Sweden, things would change of the better. Slow growth means the short term, not so much if you are able to maintain employment.

A stable domestic economy is a prerequisite for Denmark, even in times of crisis, will continue to maintain a fixed exchange rate against the euro. Elsewhere, similar arrangement caused problems, but the Danes are totally committed to continue.
By Scancomark.se Team

Key Danish Facts
Official Name Kingdom of Denmark
King Margrethe II
Prime minister Lars Lokke Rasmussen
Population 5.5 Million
Capital City Copenhagen
Monetary Unit Danish Krona (DK)
  1dk = 100 ore
Domain Name .dk
Int. Dialling Code +45
Official Language Danish
Religion Christianity
Main stock market Name NASDQ OMX OMX  Copenhagen 20
Internet Speed 4.7 Mbps (2009)
Vital Links
Statistics Denmark
OECD data on Denmark
Denmark and UNICEF
International Energy Agency Denmark
Gateway to Denmark
Danish Ministry of Foreign Affairs
Danish Exporters


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